Very worried about insurance claim hire car charges - please help

bartsimpson

Hi there,

I've read a few online scare stories about hire car charges from a claims management company, and I could really do with some help as I am getting seriously worried and losing sleep over this. I won't name them as we're going through a claim against them.

Basically we were back-ended a few months ago, not our fault, insurance company gave us 2 options: 1) pay £550 excess and lose your no claims with us, or 2) let a claims management company deal with it. Obviously we chose 2) as the accident wasn't our fault and the choice sounded a no-brainer.

Our car was taken away for repair and replaced immediately with a spanking new luxury 4x4 hire car (equivalent value and status they said, although our car wasn't worth that much and was a lot older). Due to a dispute over accident related damage, plus the appointed garage not being able to do all the repairs themselves (they had to take it to our car's main dealer), the REPAIRS TOOK AROUND 8 WEEKS TO COMPLETE, meaning we had the hire car that long.

In the event they didn't repair our car properly even after 2 months, which is why I'm claiming against them through the courts (we're awaiting a hearing date). What bothers me though is the CAR HIRE CHARGES.

Apparently the 3rd party insurer is refusing to pay up. The scare stories I've read say that we could be liable for the hire car charges but I really can't see how that could be the case. We must be talking thousands of pounds here which could ruin us.

Please could someone put our minds at rest as both myself and my wife are very very worried about this.

PS they tell us that we are covered by a credit protection policy, if that means anything...

Thanks in advance

BertTheRaccoon

Who is the hire co?

Some of them to provide an add-on protection polcy that pays the charges for you if you get to the end of the 51 week period of credit allowed in the T&C of the main rental agreement. I recall Accident Exchange do this, not sure if Albany/Helphire do.

InsideInsurance

By the sounds of it you were in Credit Hire in which case you will have signed an agreement when you got the car which will have outlined what happens if they are unable to recover all the monies from the third party insurers.

Some write it off as long as you haven't been fraudulent or prejudiced their case.

Some charge an unrecoverable fee that covers any shortfall in settlement (unless you have been fraudulent or prejudiced their case)

Some will look to you to cover the shortfall

Almost all will look to you if you have been fraudulent or prejudiced their case.

Which route your company takes will be outlined in the contract you signed. If you have misplaced it then a quick phone call to them will let you know where you stand if there is a shortfall.

vaio

the "equivalent replacement" is more to do with size & capability than age so I wouldn't worry too much about that. If you have a 10 year old Range Rover then you should get a Range Rover or similar as a replacement, as not many hire companies have 10 year old cars on the fleet then you will get a newer one.

Re the hire charges if the third party doesn't pay, as your insurer is using the credit hire firm to handle your claim (explicitly or implicitly) then I'd say your insurer would be liable if it comes unstuck so a complaint followed by referral to the FOS would likely bear fruit (assuming you have given all reasonable assistance in the recovery process)

Sonny_Bill

I work for a credit hire company. Let me explain…
You are liable for the credit hire charges, don’t let anybody tell you any different. You will have signed documents at the start of the claim confirming that you are responsible for the charges. It is down to the credit hire companies discretion as to whether they chase you for those charges. Depending on what 4x4 vehicle you have and the engine capacity, you’re looking at a daily rate of approx £200 for a 4x4.

Third party insurers don’t pay up for many reasons. Maybe liability is withdrawn, perhaps they have indemnity issues, there are many reasons. One of the main things with high credit hire claims is proving impecuniosity (which is basically you shouldn’t hire a vehicle if you can afford to either repair the car that’s been damaged, or hire a car at basic hire rates, from Enterprise for example). Insurance companies hate paying out credit hire claims because they are quite high.

Speak to the credit hire company, ask them why the third party insurers are not discharging the payments. It may be they just want to negotiate the invoice. We tend to negotiate down charges anyway and its not uncommon to agree perhaps £125 a day just to see an end to the case.

BertTheRaccoon

As explained by Sonny Bill, you have liability for the hire charges and where possible the hire company will attempt to recover all of the charges from the insurers of the party at fault, subject to you having a reasonable need for the vehicle you hired (so assuming you did not have a spare vehicle or two sat at home doing nothing) as you do have a duty to mitigate your losses (keep them to a minimum).

The repair process has to be monitored by the hire company to minimise any delays. So long as any delays were not at a result of any act or omission by yourself (i.e. so long as you cannot personally be blamed for causing a delay or expense to arise) you should not have any real risk of being hosed down by the hire co for a contribution towards the hire charges.

bartsimpson

Now I'm really confused.

Let's say the £50,000 car they provided me as a hire car while my car was in their appointed garage worked out at £300 per day. I had it for roughly 60 days while the car was being repaired.

So the bill for this would be an eye-watering £18,000.

Are you seriously suggesting that if the 3rd party refuse to pay, which I'm guessing they will if the amount is anything like £18k, I will be liable to pay this??????

Excuse my french but how the f*** can I be liable for this? Here is the sequence of events:

- Someone went into the back of my car
- Insurance company gave me 2 options, pay £550 excess and lose no claims with them, or use our claims management partner who will be free and give you a courtesy car.
- I chose option 2 as any sane person would.
- the claims management company tell me I'm entitled to a courtesy/hire car of the same status and type as my own car free of charge.
- THEY MAKE NO MENTION OF 'REASONABLE NEED' FOR THIS VEHICLE, OR CHEAPER OPTIONS ETC.
- That day they pick my car up and drop off a new 4x4 for me to use instead.
- The garage take ages to fix the problems with my car.
- 2 months later I get my car back and they take the hire car away.
- Now I'm getting letters saying that the 3rd party insurer is not paying the charges.
- I search the internet and some people tell me I may be liable for the costs of the courtesy car which could amount to £18,000 or more.

What. The. Actual. F***. Is. Going. On???


PLEASE could someone give me some advice as to what to do next?

Thanks in advance

Quentin

Check your paperwork from the hire company to see exactly what you agreed to when taking the hire car.

BertTheRaccoon

The third party insurers are unlikely to refuse to pay anything, they will want to merely chip away at the total by arguing about mitigation, i.e. did you need to have a replacement vehicle. did you need a 4x4, would your own financial position allow you to afford to hire a vehicle from your own resources.

Ultimately a compromise figure will be agreed between the third party insurers and the hire co and they should not pursue you for any shortfall.

Credit hire companies will never sit there and explain to punters in words of one syllable what they are signing as nobody would enter into a hire agreement if they realised what they were signing. So most people think it is a free courtesy car.

Did you sign a hire agreement when they delivered the 4x4 or was it posted to you weeks later?

Sonny_Bill

You should have been made aware, prior to hiring, how much the daily rate was. If you were not made aware, then it is likely unenforceable against you. However, any reputable hire company will put the daily rate of hire on the documents you have signed. Review the documentation that you should have received from the hire company.

In addition, yes you are entitled to a 4x4, but do you have a real need for a 4x4? If you could have made do with a 4 door saloon, that’s what you should have taken. However, this obviously isn’t explained to you by hire companies, because 4x4 bring a much much bigger profit, they want you to take the prestige vehicle.

Have you rang the hire company at all? Who are the hire company if you don’t mind me asking?

bartsimpson

Sonny_Bill wrote: »

You should have been made aware, prior to hiring, how much the daily rate was. If you were not made aware, then it is likely unenforceable against you. However, any reputable hire company will put the daily rate of hire on the documents you have signed. Review the documentation that you should have received from the hire company.

In addition, yes you are entitled to a 4x4, but do you have a real need for a 4x4? If you could have made do with a 4 door saloon, that’s what you should have taken. However, this obviously isn’t explained to you by hire companies, because 4x4 bring a much much bigger profit, they want you to take the prestige vehicle.

Have you rang the hire company at all? Who are the hire company if you don’t mind me asking?

I've reviewed the paperwork I signed for the car hire when it arrived (a delivery acceptance document) and it doesn't give the cost anywhere, only the details of the car (make/model etc).

I live in the countryside and local roads were flooded/icy on occasion so yes I did have a genuine need for it to get my kids to school/nursery once or twice.

BUT, why is this even a factor? I was told I would receive a car of equal status/type to my damaged vehicle. Am I supposed to say to them "hang on, send me a fiat 500 instead"? Of course I accepted the car they offered me - why would I (at the time) have had any reason not to?